If government purchases of good and services increase by $10 billion when the MPC is .8 and

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If government purchases of good and services increase by $10 billion when the MPC is .8 and the MPS is therefore .2, then

a. real GDP will increase by $16 billion.

b. real GDP will increase by $20 billion.

c. real GDP will increase by $40 billion.

d. real GDP will increase by $50 billion.

Related Book For answer-question

Applied Statistics for Public and Nonprofit Administration

ISBN: 978-1285737232

9th edition

Authors: Kenneth J. Meier, Jeffrey L. Brudney, John Bohte

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Posted Date: Jan 07, 2021 08:34 AM

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If government purchases of good and services increase by $10 billion when the MPC is .8 and

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Expert Answer:

The answer is option D which is real GDP will increase by 5... View the full answer

Applied Statistics for Public and Nonprofit Administration

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